Module 1

Introduction to
Advertising

PMCM06
Advertising Management

to your first module!

This module is a combination of

synchronous & asynchronous learningtising
and will last for one week

John Francis G. Ducusin

Course Coach

0948-342-9355
francis.smmc@gmail.com
johnfrancis020996@gmail.com

No part of this module may be reproduced

in any form without prior permission in
writing from the Instructor.

August 29, 2020

Date Initiated
September 4, 2020
Date of Completion
 SAN MATEO MUNICIPAL COLLEGE
General Luna St., Guitnang Bayan I, San Mateo, Rizal
Tel. No. (02) 8997-9070
www.smmc.edu.ph

Module 1
Introduction to Advertising

TABLE OF CONTENTS
ADVERTISING AND ITS MEANING 2
HISTORY OF ADVERTISING 3
TYPES OF ADVERTISING 5
Brand 5
Retail or Local Advertising 5
Direct-response Advertising 5
Business-to-Business Advertising 5
Institutional Advertising 6
THE COMPONENTS OF MODERN ADVERTISING 6
Advertising Strategy 7
Creative Idea 7
Creative Execution 7
Media Planning and Buying 7
ROLES OF ADVERTISING 7

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Let’s begin!

Photos from Google

What are the photos above? If your answer is advertisement, yes you are correct. These are all kinds of
advertisements that you may see from television, print, online, etc. In this module, we will start to discuss the
Introduction to Advertising.

ADVERTISING AND ITS MEANING

What is Advertising?

 It is a type of marketing communication, which is a broad term that refers to all the communication
techniques marketers use to reach their customers and deliver their messages. That includes
everything from public relations and sales promotion to direct marketing, events, sponsorships,
packaging, and personal selling.
 For many people, the word ‘advertising’ connotes television commercials, and certainly this is for fun
form of advertising. TV commercials and print ads (in magazines, billboards, online banners)
represent much of the typical advertising budget.
 Advertising is a powerful communication force and vital marketing tool helping to sell goods, services,
images, and ideas through channel of information and persuasion. It is highly visible force in the
society. Today all of us receive many advertising messages daily. Now it is essential to the success
of any type of business and industry. Furthermore, advertising strategies are employed more and
more by non-business organization such as government, college and universities, public service
groups and characteristics. It is one of the parts of the marketing and communication process.
Advertising convince people to buy products. All advertising contains both information and
persuasion. Today we can say advertising is a communication, marketing, public-relation,
information and persuasion process. Advertising reaches us through a channel of communication
referred to as a medium. It is usually aimed at a particular segment of the population - the target
audience (Consumer and business).
 Nowadays, may advertising gurus prefer the more general phrase “Integrated Marketing
Communications’ (IMC), which is broad enough to include other media (examples: public relations,
direct marketing, and etc.)

Go back to Table of Contents

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Other Definitions of Advertising

 The word advertising came from the Latin word' advertere' means "to turn the mind toward".

 The American Marketing Association (AMA) recommends the definition, "Advertising is any paid form of non-
personal presentation and promotion of ideas, goods and services by an identified sponsor".

 The AMA points out that advertising is a tool of marketing along with the product and its packaging, price,
distribution and personnel selling. Definitely advertising is openly and over the overtly subsidized information
and persuasion, and its task is to present and promote for more than merchandise. According to this definition
promotion is 'non-personal'. It is directed "to whom it may concern". If advertising is effective, it is because
the audience is receptive to it.

Paid form: When product or services are mentioned favorably in the media - newspaper, magazines
and radio or television - the item appears because it is presumed to provide information or entertainment
for the audience. But this is publicity, and no payment is made by the benefited organization. Advertising
on the other hand, is published or broadcast because the advertiser has purchased time or space to tell
the story of a certain product or service.
Non-personal presentation: Personal selling takes place when a personal face-to-face presentation is
made. Although advertising complements or may submit for, personal selling it is done in a non-personal
manner through intermediaries - or media.
Idea, goods and services: From this point advertising is concerned with much more than the promotion
of tangible goods. Most of the advertising is designed to help sell goods and services. It is being used
increasingly to further public interest group.
An Identified Sponsor: Advertising discloses or identifies the sources of the opinion and ideas.
According to an identified sponsor, this point distinguishes advertising from propaganda. Propaganda
attempts to present opinions and ideas in order to influence attitudes and actions. Advertising on the
other hand, disclose or identifies the source of the opinions and ideas it present.

 AMA definition actually describes the four main following points of advertising:
The phase paid form in the AMA definition is too restricted for many advertising professionals. The phrase
was designed to distinguish between advertising, which is delivered through space, or time for which the
advertiser has paid, and publicity, which is delivered without charge as part of the news and entertainment
content of the media.

 According to Mc Cann Erickson, Advertising is "Truth Well Told" Actually advertising is a paid publicity and
silent salesmanship. It takes known what we have to sell or what we want to buy.

 According to Seldon, "Advertising is a business force, which through printed words, sells or helps sale, build
reputation and fosters goodwill".

 John V. W. expressed, "Advertising like salesmanship is an attempt to influence the thoughts and action of
people".

 Canor and Wichart has given a definition in this form, "Advertising includes those visual or oral messages
in magazines, newspapers, movies and letters, over radio and television and on transportation vehicles and
outdoor signs which are paid by their sponsors and directed to consumers for purpose of influencing their
purchases and attitudes".

Go back to Table of Contents

HISTORY OF ADVERTISING
Advertising is an important element of our culture because it reflects and attempts to change our life style. The
concept of advertising dates to early civilization. It had to undertake a long journey through the centuries before-

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it attained its present form. Actually advertising is directly related to the need of man to communicate his message
and attract to each other. Our knowledge of advertising in ancient times naturally is fragmentary. Early advertising
can be traced back to the archaeological evidences available in Greece and Rome. In 3000 B. C. Babylonia
merchants hired parkers to hawk their wares to perspective, customers and placed signs over their doorways to
indicate what they sold. Advertisements were found on walls in the streets of the excavated Roman city of
Pompeii. Another evidence of a piece of papyrus preserved in the British Museum provides the earliest and direct
reference to written advertisement. An Egyptian had advertised 3,000 years ago asking for the return of a
runaway slave. The word of mouth or oral advertisement or spoken publicity was still older. The use of hand bills,
posters and newspaper advertisements emerged after Gutenberg developed movable type in the 15 th century.

When Benjamin Franklin established the Philadelphia Gazette in 1729, it soon became a favorite medium of
advertising. When the weekly Pennsylvania packet and General Advertiser became a daily in 1784, it featured
an entire front page of advertisement.

In ancient India, some of the typical seals used by the Mohanjodaro and Harrapa people were directly connected.
But formally, the history of advertisement in India parallels the history and development of the Indian Press during
the past 200 years. In other words we can say that advertising is a father of Journalism. Because the first Indian
newspaper started by James August Hickey on January 29, 1780, was called the "Bengal Gazette" or "Calcutta
General Advertiser". It was full of informative advertisement.

In 1785, the Bengal Journal published with Government advertisement free of charge.

By the dawn of 19th century the pattern of advertising changed-and the power of advertising increased rapidly
with the growth of trade and commerce. With the Industrial Revolution in our country, the number of
advertisements from British Business Houses rose considerably. The Times of India and The Statesman started
their own facilities for layout and copy of the advertisement.

The development of advertising agency was founded due to the development of Indian industries prov ided by
the Swadeshi Movement of 1907-1977. The major advertising agencies were, The Calcutta Advertising Agency,
Alliance Advertising Associates, Publicity Society of India, Walter Thompson (Now Hindustan Thompson).

During the mid-17th Century, newspaper started appearing in Europe and newspaper advertising was initiated
in full swing and large number of advertisement started crowding the newspaper announcing publication of
books, new beverages, travel plans and matrimonial offers. But all early advertisements were basically only
announcement. In England, some of the advertisement, which were known as a "Pioneering advertisements"
were Coffee (1652), Chocolates (1657) and Tea (1658).

The Industrial revolution, discovery of the growth of transportation facilities, advent of radio and television and
revolution in printing technology discovery of the steam power in England and America had a keen role to play
in the development of advertising.

After the Second World War and with the independence of India many British advertising agencies were brought
by Indian businessman. During the above period print advertising had to be used to raise funds. By 1932 there
were 109 advertising agencies in India ~~ advertisement had become the main source of revenue of print media.
In 1950 the advertisement of cosmetics was on the top of the list of items advertised and in 1960 consumer
goods continued to dominate with textile advertisement.

The 1970 was the important year of the growth of advertising in India. When the 'Vividh Bharati' and
'Doordarshan' played a great role in the form of commercial broadcasting and telecasting. Now radio
commercials made a real dent on the rural audience and urban working class. Besides these many periodicals
like 'India Today', 'Bombay'; New Delhi'; Surya' and various film magazines made their appearance in Indian
advertising. The role of tabloids in English and the Indian languages were very examples in the field of advertising
in India. The programs and plans of the government were also publicity announcements as also those of the
TISCO, DUNCOP, Coltex, Philips, Godrej and Hindustan Lever. These media gradually started emerging as a
mutual competitor for advertising revenue also.

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With the beginning of 21st century, the advertisers themselves became more serious and their approach
becomes more sophisticated. Print, Radio, T. V. and Internet Commercials have created deep impact on Indian
advertising. Indian advertisement has no doubt to register a rapid growth and has acquired a certain amount of
professional character. In India it has played a vital role in the development process by creating a demand for
consumer goods and raising a living of standard of millions.

On the government sector, advertisement of the railways also dominated which was soon joined by the public
sector advertisement. The massive government campaign for family planning was a new attempt to penetrate
into the conservative psyche and practice of Indian massive. Mani Shankar Iyer has also won laurels for his
unique campaign on cancer prevention.

In 20th century advertisement bloomed to its full form. More emphasis was laid on advertisement copy. Art
services and advertisement production became more and more important.
Go back to Table of Contents

TYPES OF ADVERTISING
Different types of advertising have different roles. Considering all the different advertising situations, we can
identify seven major types of advertising.

Brand
The most visible type of advertising is national consumer, or brand, advertising. Brand advertising, such as that
for new Volkswagen Beetle, Apple Macintosh, and Polo, focuses on the development of a long-term brand
identity and image.

Retail or Local Advertising

Another prevalent type of advertising directed at the consumer market is classified as retail/local advertising.
This type of advertising is done by major retailers or smaller local merchants to encourage consumers to shop
at a specific store or use a local service such as local financial companies, bank, hospitals, fitness club,
restaurants, show rooms etc. While the national advertisers sell their products at many locations, retail or
local advertisers must give the consumer a reason to patronize their establishment. Retail advertising tends to
emphasize specific customer benefits such as store house, credit policies, services, atmosphere, merchandise
assortment and other distinguish attributes.

Direct-response Advertising
Direct-response advertising is a method of direct marketing whereby a product is promoted through an
advertisement that lets the customer purchase directly from the manufacturer. Direct response advertising has
become very popular in recent years owing primarily to changing life-styles. The convenience of shopping
through the mail or by telephone has led to the tremendous increase in direct-response advertising.

Business-to-Business Advertising
Sometimes the ultimate customer is not the mass consumer market but rather another business, industry, or
profession. Business-to Business advertising is used by one business to advertise its products or services to
another. It is categorized in three basic categories like industrial, professional, and trade advertising.
 Industrial Advertising: Advertising targeted at individuals who buy or influence the purchase of industrial
goods or other services is known as industrial advertising. Industrial goods are those products that either
become a physical part of another product, or used in manufacturing other goods. Business service, such
as insurance, financial services, and health care, are also included in this category. Industrial advertising
is usually found in general business publications or in trade publications targeted to the particular
industry.
Go back to Table of Contents

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College of Business and Accountancy Prepared by: Mr. John Francis G. Ducusin
  Professional Advertising: Advertising that is targeted to professional groups-such as doctors, lawyers,
dentists, or engineers-to encourage to use the advertiser's product or specify it for other's use is known
as professional advertising. Professional groups are important because they constitute a market for
products and services they use in their businesses. Also, their recommendations influences, many
consumer purchase decisions.

 Trade Advertising: Advertising with in a trade to attract the wholesalers and retailers and motivate them
to purchase its products for resale is termed as trade advertising. Company sales representatives call on
resellers to explain the product, discuss the firm's plans for building demand among ultimate consumers,
and describe special programs being offered to the trade, such as introductory discounts, promotional
allowances. Trade advertise usually appears in publications that serve the particular industry. These
classifications of the various types of advertising demonstrate that this promotional element is used in a
variety of ways. Advertising is a very flexible promotional tool whose role in marketing program will vary
depending on the situation facing the organization and what information needs to be communicated.

Institutional Advertising
It is also called the corporate advertising. These messages focus on establishing a corporate identity or
winning the public over to the organization’s point of view. Many of the tobacco companies are running ads that
focus on positive things they are now doing, and the ads for America’s pharmaceutical companies showcasing
leukemia treatment are also adopting that focus.
 Nonprofit Advertising: Not-for-profit organizations, such as charities, foundations, associations,
hospitals, orchestras, museums, and religious institutions use nonprofit advertising for customers
(hospitals, for example) members (the environmentally focused Sierra Club), and volunteers (Red
Cross), as well as for donations and other forms of programs participation.
 Public Service Advertising: Communicates a message on behalf of good cause, such as stopping
drunk driving, or preventing child abuse. Advertising professionals usually create these advertisements,
also called as, Public Service Announcements (PSAs), free of charge, and the media often donate the
necessary space and time.

THE COMPONENTS OF MODERN ADVERTISING

In describing the practice of advertising, we refer to four components: strategy, creative idea, creative execution,
and media planning and buying (Figure 1). Each demands creative thinking from the advertising professionals
who are responsible for development and implementation. We will refer to these dimensions often, and you will
soon appreciate them as important factors driving the practice of effective advertising.

These four areas are also the fundamental concepts professionals use to analyze the effectiveness of their
advertising efforts. In other words, in order to predict how well the advertising will work, professionals critique
the strategy, the creative idea, the creative execution of their advertising ideas, and the way the message is
delivered.

Strategy Media

Effective Advertising

Creative Creative
Idea Execution

Figure 1

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Advertising Strategy
The logic and planning behind the advertisement, strategy is what gives it direction and focus. The advertiser
develops the ad to meet specific objectives, carefully directs it to a certain audience, creates a message to speak
to that audience’s most important concerns, and runs it in the media (print, broadcast, or the internet for instance)
that will reach this audience most effectively.

Creative Idea
The creative concept is the ad’s central idea that grabs your attention and sticks in your memory. The word
creative describes a critical aspect that drives the entire field of advertising. Planning the strategy calls for
imaginative problem solving: The research efforts need to be creative, and the buying and the placing of ads in
the media require creative thinking.

Creative Execution
Effective ads are also well executed, such as the series of advertisements of Bench Clothing. That means that
the details – the photography, the writing, the acting, the location where the ad is set, the printing, and the way
the product is depicted – all reflect the highest production values available to the industry. Advertising often sets
the standard or establishes the cutting edge for printing, broadcasting, and internet design because clients
demand the best production their budget allows.

Media Planning and Buying

Every message has to be delivered somehow. Most advertisers use media that reach a broad audience, such
as television, magazines, or the internet. Deciding how to deliver the message sometimes can be just as
creative as coming up with the big idea for the message.
Go back to Table of Contents

ROLES OF ADVERTISING

What does advertising do? Why does it exist? To better understand how advertising works, let’s consider the
four primary roles advertising plays in business and in society: marketing, communication, economic, and
societal.

The Marketing Role

- The process a business uses to satisfy consumer needs and wants by providing goods and services is
called marketing. The marketing department or manager is responsible for selling a company’s product,
which can be goods (computers, appliances, soft drinks), services (restaurant, insurance, real estate), or
an idea (support an organization, vote for a candidate). Products are also identified in terms of their
product category. By category, we mean the classification to which the product is assigned. For example,
Louis Vuitton is in the handbag category. Kawasaki is in the motorcycle category. The particular group of
consumers thought to be potential customers for the goods and services constitute the target market.
- The tools available to marketing managers are the product (design, performance), its price, the place
where it is made available (distribution), and its promotion. These are collectively referred to as the
marketing mix or the four Ps (product, price, place/distribution, and promotion).

The Communication Role

- The advertising is, first of all, a form of communication. In a sense, it is a message to a consumer about
a product. It gets attention, provides information and sometimes a little bit of entertainment, and tries to
create some kind of response, such as sale.

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The Economic Role
- Advertising is basically an economic institution. It performs an economic function for an advertiser affect
economic decision of the audience and is an integral part of the whole economic system. Thus an
economic evaluation show accompanies other types of appraisal of advertising. Here are some of the
economic role and benefits of advertising:
 Advertising encourages economic growth.

 Providing information utility.

 Advertising and Brand name.

 Media support.

 Distribution costs

 Effects on business cycles.

 Providing product utility.

 Advertising and monopoly.

 Encouraging new product.

 Maintain Competition

a) Market concentration

b) Concentration and prices

i) Advertising and prices

ii) Advertising and profitability
iii) Advertising and Brand stability.

At all economic level, advertising stimulates demand, educate consumer about new product, policies,
programs services and organizations, increase competition and improve standard of life-style by helping to
bring new product to the consumer. No doubt, it is a fuel that boosts the economy by helping to introduce
new products faster and more effectively to consumer by supporting to achieve the economies of scale faster
and by helping to remove the monopoly of the product.
Go back to Table of Contents

The Societal Role

- At social level advertising plays upon, derives from and contributes to the social texture of a country.
Advertising reflects society and socie1y reflects advertising. Various social changes are brought about
or helped by advertising. It makes role models who can create societal change. Adult education, family
planning and pulse polio campaign also used to sell the concept of social advertising. It is a positive force
in our society. It makes to the nation's social welfare.

You are now done with MODULE 1.

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College of Business and Accountancy Prepared by: Mr. John Francis G. Ducusin